How Brexit Affects Buying Property In Spain

Buying property in Spain after the Brexit referendum is still possible, but the rules have changed somewhat for UK citizens. Here we discuss how Brexits affects property purchases in Spain.

Can I buy a home in Spain after Brexit?

There are no laws that limit the purchase of Spanish property to only EU residents. This is an essential point, as misinformation can cause uncertainty. In Spain, if you can afford the purchase price of a property, it is yours.

Over the years, citizens from outside the EU boundaries like Norwegians or Americans have bought property in Spain without issues, and because Britain has exited the EU does not change this practice, there will not be a specific rule preventing UK citizens from buying.

Not only are you legally able to purchase a house in Spain, but the Spanish government is always working hard to promote property sales to non-EU residents with opportunities like the Golden Visa scheme. Spain benefits tremendously from foreigners buying property and staying in the country, Brexit, or no Brexit.

In fact, the number of UK citizens deciding to buy Spanish property and live in Spain has risen since Brexit especially with the benefits obtained from the favourable currency rate fluctuations.

Will it cost more money due to Brexit?

No. Your nationality does not influence the price you pay for real estate. Whether you’re from an EU country or not, the price is the same.

The payments you have to make in Spain to buy property is equal for everyone. These include:

  •        Purchase tax
  •        Notary fee
  •        Property registry fee

Concerning the notary fee, to buy a property in the UK, you exchange contracts, pay the seller and the property is yours, an uncomplicated procedure. Following this, you add your name to the property deeds in the land register.

But, in Spain, a notary has to witness the procedure before you can add your name to the property register. The price you pay for the notary is government controlled and based on the number of conditions in the property deeds and the value of the property.

Another thing to consider is fluctuation of the British Pound and Euro is normal and will determine how much UK currency is worth, and what you pay to buy the property. This is an issue to bear in mind when purchasing a Spanish property post Brexit.

Regardless of Brexit, whether you are a Spanish resident or non-resident you have to pay taxes in Spain concerning the purchase, sale, and ownership of real estate.

Will there be difficulties visiting the property or living in Spain due to Brexit?

If you’re purchasing a property in Spain following Brexit and you want to visit the country for short-term periods, you won’t notice any difference.

It is still uncertain, but if you want to stay longer than 90 days, you might need a Visa. This likely isn’t as problematic as it first sounds, and you will probably only need to pay a small fee at the airport. However, this has not been fully agreed on yet.

Tourism is one of the essential industries in Spain, and 18 million Brits visit Spain each year. The Spanish government likely will do their best to keep this up, meaning they will make it as straightforward as possible for UK residents to buy property, visit or live in Spain. It is for the country’s benefit.

Can I rent out my property after Brexit?

You will be able to let a property without a problem, but it might be more expensive.

As a Spanish or EU national, rental income tax is 19%. However, for non-EU citizens, the rental tax is 24%, so there are different laws for renting, depending if you are a European citizen or not.

So Brexit could have an impact on this; UK citizens could end up paying the same income tax for rentals as non-EU residents and also possibly be charged for property inheritance tax at a more expensive rate.

The process of renting a property legally in Spain will remain the same.

Spanish Property Market after Brexit

The Spanish property market has significantly fluctuated throughout recent years, but it has been recovering well since its disastrous 30% fall between 2007 and 2014. Right now, buying Spanish property is a sound investment.

So, is it smart to purchase property in Spain post Brexit?

At the beginning of 2019, the average Spanish property price increased up to 6%, making it a prudent choice in terms of buying and reselling a property. Going into 2020, housing prices relaxed and have stayed steady, making purchasing a ‘sustainable’ investment.